India:
Gaming Law

To print this article, all you need is to be registered or login on Mondaq.com.

1. Introduction

1.1 Current Outlook

Policy Changes

A day after the Law Commission of India released its report
entitled 'Legal Framework: Gambling and Sports Betting
Including in Cricket in India ("Report"), the Commission
released a press note stressing that its recommendation was to ban
betting and gambling in India. However, if the Central Government
or State Governments did consider regulating it, the Report set out
some positive and logical measures to combat certain industry
issues. The Report is under consideration by the Government.

On the heels of the Report, the Sports (Online Gaming and
Prevention of Fraud) Bill, 2018 ("Sports Bill") was
introduced as a private members bill in the Lok Sabha, on 28
December 2018. The Statement of Objects and Reasons accompanying
the Sports Bill has underscored that it has been introduced with
the dual aims of preserving integrity in sports and introducing a
regulatory regime for online sports betting.

However, the Sports Bill lapsed with the dissolution of
Parliament prior to general elections, and has not been
reintroduced.

The All India Gaming Federation (AIGF), a self-regulatory body
for online games of skill has written to the Prime Minister of
India demanding that the Enforcement Directorate investigate and
take action against offshore betting websites that are illegally
offering websites to Indian citizens and accepting bets from India,
in contravention of the Information Technology Act, 2000 ("IT
Act") and the Foreign Exchange Management Act, 1999
("FEMA").

Pending Litigation

As stated above, the question of whether sports betting is a
game of skill is pending before the Supreme Court in the case of
Geeta Rani v Union of India & Ors ("Geeta Rani
Case"). If the judgment concludes that sports betting is a
game of skill, it will be exempt from most Gaming Enactments and
can be offered in most Indian states that recognise an exemption
for games of skill.

Insofar as poker is concerned, an appeal is pending against the
judgment of the High Court of Gujarat, which has held that poker is
a game of chance/gambling activity.

Furthermore, the Telangana Gaming Act, 1974 ("Telangana
Act") was recently amended to delete the exception for games
of skill. The Telangana Gaming (Amendment) Act, 2017
("Amendment Act") is currently being challenged before
the High Court of Hyderabad.

In the case of Ramachandran K v The Circle Inspector of Police,
the Kerala High Court has held that playing rummy for stakes would
amount to the offence of gambling under the Kerala Gaming Act, 1960
("Kerala Act"). Previously, in the landmark judgment of
State of Andhra Pradesh v K Satyanarayana, the Supreme Court had
held that 13-card rummy was mainly and preponderantly a game of
skill. A review petition was filed against the order of the Kerala
High Court, but was dismissed. The court held that whether rummy
played for stakes would amount to gambling would have to be decided
on a case-by-case basis. A court would need to consider the manner
in which the games were conducted online, and what stakes were
involved.

In a case before the High Court of Delhi, a petitioner has
sought a complete ban on online gambling websites from operating in
India (both Indian and foreign). The petitioner has sought certain
directions from Government entities that taxes are recovered from
persons engaged in such gambling activities, and that violations of
FEMA are checked. This petition is targeted only at games of
chance, and has named poker, nap, sports betting, fantasy sports
and election result prediction-related games as an illustrative
list.

As per news reports, another public interest litigation case has
been filed before the High Court of Delhi seeking a complete ban on
poker and similar card games, played online and offline. The
petition has also reportedly sought a ban on the advertising of
such games.

1.2 Recent Changes

As stated above, a review petition was filed against the order
of the High Court of Kerala in the matter of Play Games 24X7 Pvt.
Ltd v Ramachandran K & Anr. However, the court dismissed the
petition, and held that whether playing rummy for stakes (including
online rummy) would amount to a violation of the Kerala Act would
have to be assessed on a case-by-case basis.

The dismissal of the review petition has called into question
whether any games of skill can be played for stakes.

2. Jurisdictional Overview

2.1 Online

Background

Betting and gambling is a state subject under the Constitution
of India so each state has the exclusive legislative competence to
enact laws relating to betting and gambling within the state. The
Public Gambling Act, 1867 (PGA) has been adopted by certain states
in India, while other states have enacted their own legislation to
regulate betting and gambling activities within the state
("State Enactments").

The PGA and most of the State Enactments (collectively,
"Gaming Enactments") were enacted prior to the advent of
virtual/online gambling and therefore primarily prohibit gambling
activities taking place within physical premises, defined as a
"common gaming house".

Betting

Betting on games of chance is prohibited under most Gaming
Enactments. As stated above, the question of whether sports betting
is a game of skill is pending before the Supreme Court in the case
of Geeta Rani v Union of India & Ors. ("Geeta Rani
Case").

In the case of Dr. K R Lakshmanan v State of Tamil Nadu
("Lakshmanan Case"), the Supreme Court held that betting
on horse racing was a game of skill. Accordingly, betting on horse
racing is treated as a game of skill and is exempt from the
prohibitions under most Gaming Enactments.

Most Gaming Enactments have carved out an exception for
"wagering or betting upon a horse-race" from the
definition of gaming/gambling ("Horse Racing Exemption").
However, the Horse Racing Exemption is subject to certain
conditions under the Gaming Enactments, such as when wagering or
betting takes place on the day on which the horse has run, in an
enclosure that has been sanctioned by the State Government, etc. In
the case of online horse racing, it would be difficult for these
conditions to be met. However, one can explore arguing whether a
horse racing product is a game of skill independent of the Horse
Racing Exemption.

Bingo

Depending upon the format, bingo may fall within the definition
of a "lottery" or under the general definition of
betting/gambling under most Gaming Enactments, as it is a game of
chance and is prohibited in most Indian States. See below for a
discussion on lotteries.

Casino

Casino games are predominantly chance-based, so are treated as
betting and gambling activities, and are therefore prohibited under
most Gaming Enactments. This applies for both digital and
land-based casino gaming.

The Sikkim Online Gaming (Regulation) Act, 2008 ("Sikkim
Online Act") covers certain casino games, such as Roulette,
Casino Brag and Blackjack, which may be offered through the
state-wide intranet within the State of Sikkim only

Lotteries

Under the Lotteries (Regulation) Act, 1998 and the Lotteries
(Regulation) Rules, 2010 ("Lottery Laws"), State
Governments are empowered to organise, conduct and promote
lotteries, subject to certain conditions.

Some states regulate physical lotteries (such as Sikkim), and
lotteries have been banned in certain states (such as Madhya
Pradesh). Some states specifically provide for online lotteries
(such as Punjab).

The State Governments are empowered to appoint individual or
corporate entities as "distributors" or "selling
agents" to market and sell lotteries on behalf of the
organising state under the Lottery Laws.

Section 294 A of the Indian Penal Code, 1860 (IPC) specifically
prohibits private lotteries. Certain states have repealed Section
294 A of the IPC and enacted their own legislation banning
lotteries other than non-profit lotteries (such as the States of
Andhra Pradesh, Gujarat, Karnataka, Maharashtra, etc). Certain
other states have introduced legislation expressly banning
lotteries in their states (eg, the State of Bihar vide the Bihar
Ban on Lottery Act, 1993).

Fantasy Sports

Certain versions of fantasy sports games can be argued to be
preponderantly skill-based games in the Indian context.
Accordingly, such games can be treated as exempted under the Gaming
Enactments.

The High Court of Punjab and Haryana held Dream 11's format
of fantasy sport to be a game of skill in the case of Shri Varun
Gumber v UT of Chandigarh & Ors. ("Varun Gumber
Case"). Thereafter, the High Court of Bombay also recognised
that the same format of fantasy sport was a game of skill in
Gurdeep Singh Sachar v Union of India.

The Nagaland Prohibition of Gambling and Promotion and
Regulation of Online Games of Skill Act, 2016 ("Nagaland
Act") expressly recognises virtual team selection games and
virtual sport fantasy league games as games of skill. If such games
are sought to be offered online in the State of Nagaland, a licence
would be required.

Social Gaming

Social gaming refers to those games in which no prize is
offered. When there is no prize of money or money's worth
offered, the game is typically not considered to be gambling under
the Gaming Enactments. Depending upon the format and content of
such games, certain other laws could be triggered, such as the
intellectual property laws, and laws prohibiting certain types of
content, such as the IPC or the IT Act, which prohibits obscene
content, or the Indecent Representation of Women (Prohibition) Act,
1986 (IRWA), which prohibits depicting women in a derogatory
manner.

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.

To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

Please set your data preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access

No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq: